Asian Airlines to sees only ‘modest revenue’ growth in 2011; margins pressured: AAPA

Economic weakness in Europe and the US is having a financial impact on Asia's airlines, with margins pressured by the combination of high oil prices and slower demand. According to Association of Asia Pacific Airlines (AAPA), the situation is also impacting medium-term growth prospects, as indicators point to a continuation of present market weakness into 2012.

However, the region's carriers are better placed than most. Despite the expectation of more "modest revenue growth" and the "squeezing" on what is "already very thin margins", Asia Pacific airlines are better placed than their European and US counterparts, as many of the region's economies are still experiencing solid growth, and long term prospects are "positive", according to AAPA. The industry body added that the optimism regarding future growth opportunities underpins "ambitious fleet expansion plans, as well as the establishment of a number of new carriers of varying business models, including international partnerships and joint ventures."